European Parliament Workshop on the Anti-Counterfeiting Trade Agreement

Brussels, 1 March 2012

Professor Moreira, Honourable Members, Ladies and Gentlemen,

We had a good discussion yesterday and today with the International Trade Committee. We looked at some of the concerns about the agreement and I hope that I was able to lay some fears to rest. But we also talked about the clear economic reasons why we have negotiated ACTA. And that is very important, I think. Because I firmly believe in this agreement.

I don't merely think that the citizens of Europe have nothing to fear from ACTA. I do know that to be true and I will have a few words to say about it later on. But on top of that, I think that Europe needs ACTA. That is why we have engaged in difficult negotiations with our partners and that is why I urge the European Parliament to consider the agreement favourably.

There are many types of creative processes in business. Some lead to new films, some lead to stylish clothes, others to better machines and still others to great wines. But they have three things in common:

First, Europeans are very good at them. Think about it, our world-beating companies are all strong innovators.

Second, it is not just the designers or owners who benefit. Many more jobs flow from creative ideas – whether in manufacturing, marketing, finance or logistics.

And third, if businesses based on creativity are to function, they require the protection and enforcement of intellectual property rights.

The most conservative estimates of the size of the global counterfeiting and piracy industry put it at 250 billion US dollars a year. But that estimate excludes all unauthorised copying on the internet and any counterfeiting and piracy where the product is sold in the country where it was produced - including China.

But counterfeiting and piracy is much less of a problem in Europe than it is in other countries of the world. That is because in Europe we have a comprehensive system to protect intellectual property. We have outlined the rights that can be protected and the means to enforce them. We have implemented that programme in the Member States together with their authorities.

When we elaborated our IPR protection system, we have also chosen to safeguard the rights of citizens to free speech, data protection and access to information as well as the rights of Internet service providers and other intermediaries who deal with protected goods. These two goals are compatible and even mutually supportive.

Which brings me back to ACTA.

What the European Union is trying to do with this agreement is to extend the reach of the enforcement parts of our system beyond our borders.

ACTA is an enforcement treaty. That means it does not cover the details of what is legal and what is illegal. But it does address procedures for ensuring that what is illegal can be redressed.

ACTA simply means that companies and individuals who wish to protect their ideas so as to defend their livelihoods will find it easier to do so in the 38 countries that have signed the treaty.

ACTA is, I will admit, a relatively modest agreement between a relatively small number of countries.

But it is a significant first step. It establishes a nucleus of countries that are committed to the highest standards of intellectual property rights enforcement. A nucleus that will grow. The World Trade Organisation had a different name, a weaker structure and only nine members when it started out in 1948. After Russia’s accession later this year, nearly every country in the world will have joined and nearly all world trade will be bound by its rules.

We would have liked to have negotiated this agreement at a global level. That was not possible. But the countries that have joined us in this agreement will soon begin to see the benefits of good enforcement, in terms of investment and in terms of innovation.

The OECD has found that in developing countries an increase of 1% in the strength of patent rights is associated with an increase of 1.7% in foreign direct investment flows.

When those kinds of changes are seen to happen more countries will join ACTA. The nucleus will begin to expand.

Professor Moreira, if you'll permit me, I will also take some time to address the concerns about this agreement.

I'm sure that all of you here today have been closely following this debate. Its intensity on the internet, in the newspapers and on the streets has been remarkable.

I have also been following this discussion very closely.

I have listened with particular care to the thousands of people who took to the streets – on some of the coldest days we have seen for many years – to demonstrate their concern about ACTA.

I find it hugely encouraging to see this level of engagement with politics. For many years, we lamented a lack of engagement, particularly by the young.

Well now we have it.

We may not like all that is said. We may even have grave doubts about the methods used, particularly the cyber-attacks on democratic institutions.

But as politicians, it is our duty to return that engagement.

And, while I appreciate this may come as a surprise to some, I think we actually have something to add to the debate.

Because in all the discussion around this issue, in the countless blog entries, tweets and articles, I have noticed that one commodity has been in short supply. That commodity is the truth.

I have read that ACTA restricts free speech, that it will "break" the internet, and that sick people in developing countries should be particularly on their guard.

And yet as someone responsible for negotiating the agreement, I know that ACTA does not do any of those things.

So I have one message for you today. It is the same message I delivered yesterday and the same one I will continue to deliver for as long as is needed:

ACTA is not an attack on your liberties; it is a defence of your livelihoods.

ACTA will not censor the internet. It will not mandate monitoring or controls on people's e-mails, their blogs or their file-sharing activities.

ACTA will not require the inspection of laptops or MP3 players by customs officials.

And ACTA will not impose any restrictions on trade in generic medicines.

Here is why: One of our achievements in this negotiation is to ensure that ACTA is very closely modelled on the European system. What this means in practice is that the European Union will not need to make any modifications to its current legislation in order to comply.

And what that means in turn is that there will be no change whatsoever to the current balance of rights and safeguards for European citizens. Except, of course, that their inventions will be better protected around the world.

Yesterday, I gave the example of the disclosure of internet users' data, as it is frequently alleged that this will lead to surveillance of individuals by private companies, but, as I explained, this is simply not true.

ACTA states that signatories may give their intellectual property enforcement authorities a new power – the power to compel an internet service provider to disclose personal data on subscriber accounts to rights holders – if the account is suspected of being used for infringement. In this provision, ACTA changes nothing about our freedom to make policy. The treaty is simply pointing out what some of its signatories consider to be best practice.

In fact, in Europe we took the democratic decision to introduce this same provision into our law 12 years ago, in the E-commerce Directive. And it has been implemented by the Member States in a balanced and proportional way.

The reason for this balance and proportion is that European legislation provides, as I have said, a series of safeguards to protect the rights of individuals and internet service providers in this area. All these safeguards will remain in place with ACTA and most are repeated throughout the text of the agreement.

Just last month, in fact, the European Court of Justice upheld one of these safeguards against online surveillance in a landmark ruling in the SABAM versus Netlog case. The court stated simply that service providers like Netlog - or Facebook or Google - cannot be obliged to monitor information distributed over their networks by individuals in order to check for rights violations.

The ruling should remind us that we are in safe hands with the European Court of Justice, and this will not change under ACTA. ACTA does not have an international dispute settlement or arbitration procedure. This means that the final word regarding the interpretation of its provisions will belong to each jurisdiction. In Europe that means that our courts, including the European Court of Justice, will be responsible for its interpretation.

Let me also say a word on the issue of file-sharing by individuals.

I think it's fair to say that everyone in this room knows someone who, without paying for it, has downloaded onto their computer a song, an album or an episode of a television series.

I cannot, in good conscience, condone that action. I know there are some people who see this differently, young people in particular. But for me there is no moral difference between taking something that is not yours in the physical world and doing the same in the virtual world. Illegal downloading means money that should have gone to creative people in our society has not. It is a disincentive to their work.

However, maybe some of you are worried that the people you know may face fines or jail as a result of ACTA.

Today's law is quite specific here. To steal even an apple remains a crime that can be reported to the police. However, to download a song without paying for it, while strictly speaking illegal, is not a criminal offence. There is no possibility of punitive action unless the activity was carried out at a commercial scale.

That will not change under ACTA. So if this is why you are having doubts, let me be clear: ACTA will not criminalise anything that is not already a crime. Thousands of young will not be hauled before the courts because of it.

I should also address some of the criticisms that have been levelled at ACTA which in fact relate to a different debate entirely.

In recent years, some have put forward the legitimate view that our system of copyright protection needs significant updating for the digital age. This is an important debate, but it has nothing to do with ACTA.

ACTA is about enforcing current law. But it does not define or freeze what is legal and illegal. Changes to the copyright system require changes to the copyright rules. And these cannot be found in ACTA.

Commissioner Barnier and Commissioner Kroes are working on initiatives to make digital content more accessible to citizens. For instance, there is work in progress on a pan-European license for music; easier licensing for so-called "orphan works"; and the creation of online digital libraries.

These initiatives seek to give consumers and users better access to cultural content while allowing for new business models to thrive. And, they will need the full agreement of the European Parliament in order to become law.

Professor Moreira, Honourable Members, Ladies and Gentlemen,

I hope I have been able to reassure you on some of the concerns people feel about this agreement. But I also understand that my word alone may not be good enough for some.

This is why I recommended to my fellow Commissioners, who accepted my proposal, that we put ACTA before the European Court of Justice.

The Court will provide much needed clarity on our concerns on the fundamental rights and freedoms of European citizens. Its ruling should help support a calm, reasoned, open and democratic discussion on ACTA – a discussion we sorely need to have.

Because, as I have said, we need to move forward on this issue. The world is changing. We live in a competitive age. If we don't protect our economic future then no one else will. I look forward to our discussion.